I also have the 2.66 Mac Pro 4.1 Quad core (16G Ram) with an internal Raid. I tried to edit a couple of projects with H264 but the stuttering was just too much to be workable, so for now I convert to ProRes.
I am thinking about upgrading to either the top of the line 8 core or the 12 core, but I don’t want to blow $6K only to find that when working with H264 it still does not run smoothly. I know its not an editing codec, but if you throw a bunch of processing power at it does that become a non issue ?
I thought of going the PC route, but I have to much invested in Mac at this point for that to be an option.